Yahoo shares rose 4.5 percent to $21.22 in after hours trading on Monday.

"We got the revenue acceleration we were hoping for. Display was down, but search is doing better" said Sameet Sinha, an analyst at B. Riley Caris.

"As long as in the near-term things are not bad, I think the stock will generally act positively while we wait for Marissa Mayer to deliver," said Sinha.

The company said its fourth-quarter net income was $272.3 million, or 23 cents per share, versus $295.6 million, or 24 cents per share in the year-ago period.

Excluding certain items, Yahoo said it had earnings per share of 32 cents, versus the average analyst expectation of 28 cents according to Thomson Reuters I/B/E/S.

Yahoo said that search revenue increased 4 percent to $482 million in the fourth quarter, while display advertising revenue fell by 3 percent to $591 million.

Chief Executive Marissa Mayer is moving to revive the company's fortunes after several years of declining revenue. Yahoo's stock has risen roughly 30 percent since she became CEO, reaching its highest levels since 2008.

Yahoo said it repurchased $1.5 billion worth of shares during the fourth quarter. (Reporting by Alexei Oreskovic; Editing by Phil Berlowitz)

NEW DELHI Prime Minister Narendra Modi's surprise decision to scrap high-value banknotes has upset preparations for next year's budget because of the resulting disruption to growth, revenues and asset sales, two government sources said.

BENGALURU Indian inflation is expected to have cooled to a 14-month low in November after Prime Minister Narendra Modi's surprise removal of high denomination bank notes caused an intense cash shortage and severely hurt consumption, a Reuters poll found.